Business Development Series Posted by David McDermott

Effective negotiating in high value transactions requires the knowledge, skill and strategies necessary to achieve an outcome that is satisfactory for both parties. This is often referred to as a principled approach and a win-win outcome.

When training and coaching clients we are often asked about less principled approaches i.e. ‘dirty tricks’. Our advice is clear, we advise clients not to use these tactics as they can damage relationships. It is still important to be aware of them and know how to countermeasure in the event they are used on you.

Assuming you are well prepared for the negotiation i.e. you have decided on the issues to be negotiated and on your ideal (best), realistic and fallback position (upper limit for buyers and lower limit for sellers) then dealing with these tactics will be easier. It is also important to know the three golden rules, proven to make you a more effective negotiator:

These dirty tricks are designed to get you to reveal your fallback position early. We have identified three of them and their appropriate countermeasures.

1. Bottom line
This is a tactic often used on inexperienced negotiators. It works like this, “We are interested in going ahead with this. In the interests of getting this over the line quickly, can you give me your best offer (or bottom line).” It is often requested in the form of a quote, proposal or offer. The other party will then pass you over to someone else or proceed to negotiate on your fallback. To counter this, simply go ahead as planned and offer your ideal. Never give your fallback position to start. You could say, “A fair price would be…”

2. Crunch
This tactic is usually preceded with an astonished or puzzled look followed by, “You will have to do significantly better than that.” Here, the other party is aiming to move you from your ideal to fallback rapidly. An effective countermeasure is to remain calm and ask the person how much better. Alternatively, you could give a small concession and ensure you ask for something in return.

3. Outrageous initial demand
By making an initial offer that is so outrageously far away from expectations the other party expects you to get closer by offering your fallback. Again, resist the temptation, remain calm and state your ideal. You could ask them how they came to that proposal or try the crunch!

Remember, no deal is better than a bad deal. You can always walk away on moral grounds.

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